Students Are Refusing to Pay Back Their Loans When Payment Pause Ends

[GMCGeneral]

AFAIK, the schools can't forgive; they are not the lender. The school simply determines how much borrowing is required based on academic workload, textbooks, average COL, etc. But the debt is either owned by Uncle Sam or private lenders.

The solution is to allow these debts to be discharged in bankruptcy. Since there's so much outstanding debt out there I'm not sure regular bankruptcy would work without destabilizing the higher ed lending ecosystem and the overall economy so there might need to be some tweaks.

Student loans cannot be discharged via bankruptcy.

 

[JohnDB]

AFAIK, the schools can't forgive; they are not the lender. The school simply determines how much borrowing is required based on academic workload, textbooks, average COL, etc. But the debt is either owned by Uncle Sam or private lenders.

The solution is to allow these debts to be discharged in bankruptcy. Since there's so much outstanding debt out there I'm not sure regular bankruptcy would work without destabilizing the higher ed lending ecosystem and the overall economy so there might need to be some tweaks.

Unfortunately student loans are just like taxes....there is no forgiveness unless Congress passes a law that allows it specifically.
And they have to do it specifically....

Meaning, no car loans, house mortgages, no more credit cards....no federal permits of any kind. Possible incarceration if allowed to go that far.

A person's best bet is to secure some sort of private institution debt, pay off the loans and then declare bankruptcy....you can get out from under them that way. (It's how it used to be done 20-30 years ago)

But just refusing to pay gets trouble on your back that increases exponentially.

 

[tyroneweaver]

You signed the papers, just like I did, so you can pay it all back just like I did. Those refusing to pay hopefully will see their credit ratings go in the toilet.

MSN

Stop the loan program

 

[JohnDB]

Stop the loan program

Actually it would be better to reform it instead. Restrict loans to those taking STEM instead of liberal arts.

 

[Flash]

Why only forgive student loans?

Why not forgive car loans for anybody that votes for Democrats?

Why not forgive home mortgages for anybody that votes for Democrats?

Isn't transportation and housing just as or even more important as getting a college degree in a subject that doesn't generate a rate of return good enough to pay back a loan?

 

[Mac1958]

I really wouldn't suggest trashing your credit rating.

 

[Mac-7]

You signed the papers, just like I did, so you can pay it all back just like I did. Those refusing to pay hopefully will see their credit ratings go in the toilet.

MSN

This is a racial issue

I suspect that blacks are more likely to default than whites

 

[22lcidw]

I really wouldn't suggest trashing your credit rating.

The credit rating is the result of a privately owned fiat currency enacted from foolish politicians and owned by mostly foreign bankers. How much is owed keeps growing and growing. And what is owed in global ways goes back further than the 1619 project. The way the federal income tax was written is unconstitutional on how it is enforced. However, corrupted judges overturned any questions. And that is we pay the federal tax every three months. We of course have it taken out of our paychecks and any checks we receive from other ways every week, two weeks, every month and so on. They're just doing us a favor. No, most people realizing what the pay in federal taxes would not send out a check to the government every three months. And much of this was before the federal taxes really took off for the peasants.

 

[Cellblock2429]

Meh...declare bankrupcy 7 times and then run for President.

/----/ That never happened in US history.

 

[Jarlaxle]

Democrats will spend the next decade promising forgiveness of said loans for votes. At the end of the day, you can't repo education. The potential penalties simply do not exceed the benefits of not paying.

Maybe it really is time to bring back debtor's prison.

I really wouldn't suggest trashing your credit rating.

I wish I had no credit rating.

 

[multivita-man]

A person's best bet is to secure some sort of private institution debt, pay off the loans and then declare bankruptcy....you can get out from under them that way. (It's how it used to be done 20-30 years ago)

Can't do that now - Congress changed the law around 2004-5 or so to apply the same onerous conditions to private lending as well, which makes zero sense other than the fact that it allows private lenders to seize property and garnish wages to scrape more of their $ back...plus interest. That, among other things, convinced me that higher ed has become a financial racket with many different players. It also convinced me that I'd better pay back my fucking loans, or else...

I think the system needs to be changed. Let's start with making it harder for people to get loans in the first place. Prove that either your parents or you can somehow pay back the substantial amount of loans to be borrowed. Also prove that you have a good chance of finishing a degree program. People who barely graduate with minimum required GPA and weak test scores should be considered high-risk borrowers.

But beyond that, education is not only good for the individual but the community at large. It should be affordable and interest-free. There should be flexible repayment options, and if for some reason things don't work out and people fall into arrears, then it should be dischargeable like any other debt.

 

[multivita-man]

Student loans cannot be discharged via bankruptcy.

I didn't say they could; I said that's the solution. As they can't do so now, the policy should be changed to allow that, but as I said, there's so much outstanding student debt right now, I'm honestly not sure what the economic consequences of that would be.

 

[DGS49]

Yinz are ignorant of history. The reason why student loans cannot be discharged in Bankruptcy is that so many doctors, lawyers, veterinarians, etc., were finishing school and immediately declaring bankruptcy so that they could start their professional careers debt free. This was rightly considered an abuse of the system and theft of the creditors.

AND, you can certainly refuse to pay off your student loans, but all traditional collection methods are still on the table. Own a home? Not for long.

 

[JohnDB]

Can't do that now - Congress changed the law around 2004-5 or so to apply the same onerous conditions to private lending as well, which makes zero sense other than the fact that it allows private lenders to seize property and garnish wages to scrape more of their $ back...plus interest. That, among other things, convinced me that higher ed has become a financial racket with many different players. It also convinced me that I'd better pay back my fucking loans, or else...

I think the system needs to be changed. Let's start with making it harder for people to get loans in the first place. Prove that either your parents or you can somehow pay back the substantial amount of loans to be borrowed. Also prove that you have a good chance of finishing a degree program. People who barely graduate with minimum required GPA and weak test scores should be considered high-risk borrowers.

But beyond that, education is not only good for the individual but the community at large. It should be affordable and interest-free. There should be flexible repayment options, and if for some reason things don't work out and people fall into arrears, then it should be dischargeable like any other debt.

Yes,
Reform of the program is most definitely needed before we start even considering blanket loan forgiveness. Like restrictions on loans for clown classes and instead loans for STEM degrees. GSLs for someone to accomplish religious studies is not exactly helpful. But a PHD in organic chemistry is just fine to fund.

Do we really need another PHD in Mideval French Literature? What job are they gonna get to pay the $600k back?

And we are also really short on things like skilled trades people. Like plumbers, pipefitters, electricians, electronic techs, and motor controls. (There are others)

Skilled blue collar jobs are plentiful...they aren't the same as they used to be....sure there's a lot of bull work to them but those guys only look stupid...they are educated if they are any good. Those sorts of educations are desperately needed and need to be more standardized than ever before because the construction standards and building utilization has increased dramatically over the past 40 years.

 

[GMCGeneral]

Yes,
Reform of the program is most definitely needed before we start even considering blanket loan forgiveness. Like restrictions on loans for clown classes and instead loans for STEM degrees. GSLs for someone to accomplish religious studies is not exactly helpful. But a PHD in organic chemistry is just fine to fund.

Do we really need another PHD in Mideval French Literature? What job are they gonna get to pay the $600k back?

And we are also really short on things like skilled trades people. Like plumbers, pipefitters, electricians, electronic techs, and motor controls. (There are others)

Skilled blue collar jobs are plentiful...they aren't the same as they used to be....sure there's a lot of bull work to them but those guys only look stupid...they are educated if they are any good. Those sorts of educations are desperately needed and need to be more standardized than ever before because the construction standards and building utilization has increased dramatically over the past 40 years.

Plus not to mention in the transportation sector, technology has also changed dramatically over the years and is far more complex than the diesel engines in the past, for example.

 

[otto105]

You signed the papers, just like I did, so you can pay it all back just like I did. Those refusing to pay hopefully will see their credit ratings go in the toilet.

MSN

Sounds like a trump thing to do.

 

[iamwhatiseem]

The Biden 2024 campaign strategy.........

 

[JohnDB]

Plus not to mention in the transportation sector, technology has also changed dramatically over the years and is far more complex than the diesel engines in the past, for example.

Oh yeah....you ain't even wrong there at all.

 

[DigitalDrifter]

Sounds like a trump thing to do.

Paying your own bills? Doesn't sound very Trumpy to me.

 

[otto105]

Paying your own bills? Doesn't sound very Trumpy to me.

Exactly